fraud's global footprint is bigger than most think

10-12-2015

Part of the solution to tackling fraud begins with raising
awareness in general. It’s no longer acceptable within the UK to turn a
blind-eye to fraud in the workplace. The CIPFA Counter Fraud Centre, as part of
its role, champions the need to proactively fight fraud and help safeguard the
public sector, and its purse, from the growing fraud problem. The price
individuals, businesses, organisations and governments pay for ignoring fraud
is high with reputations as well as finances at risk.

The growing cost and the seriousness of global fraud is also
on the increase. In the UK alone public services fraud costs the taxpayer
an estimated £21 billion a year. Part of the solution to the problem of
fraud lies in informing people on the best ways to prevent fraud and corruption
in the workplace, as well as educating individuals and teams who are more
likely to be exposed to bribery, fraud and corruption. Being able to
recognise and identify the early warning signs makes a substantial difference
to an organisation’s counter fraud defences.

Education and awareness raising reduces the risk of fraud in
both public and private sectors. One key area many public sector
organisations should address is ensuring that employees who require a working
knowledge of bribery and corruption risks, as part of their job, are up to date
with the latest training in this specialist area. To help with this, the
Counter Fraud Centre has created the Anti-bribery and Corruption e-Learning
Package. The e-learning package equips workers with the skills and
knowledge required to effectively block and prevent bribery and corruption at
work.

Geared towards those on the ground who have increased
exposure to bribery risk, the e-learning package illustrates the reach of the
UK Bribery Act (2010), and draws attention to the fact that becoming involved
in bribery anywhere in the world is the same as becoming involved in bribery in
the UK. Employees, for example, are not exempt from the Act if they work
overseas, and may be investigated by UK law enforcement and regulatory
agencies, and be tried in UK courts even if the offence took place
overseas.

Many people in the UK, and UK citizens working abroad for
public, private and not-for-profit, need to be alert to risks and to the
development of a relationship that could lead to a bribe being hinted at,
offered or even accepted. The e-learning package makes navigating the murky waters of bribery a lot easier as it brings
clarity to what is often perceived as a complex area of regulation.

A common area of confusion, for example, is understanding
the difference between bribery and corruption as the terms are often used
interchangeably. Corruption is essentially about the ‘corruption’ of
office or its use for private, personal or partisan interests. This may
take a number of criminalised forms, such as bribery or embezzlement, or
ethical issues including conflict of interest or cronyism.

On the other hand bribery’s distinctive characteristic is
the transaction, or the possibility of the transaction. For example, ‘I
give you, or promise or offer, to give you something and I get, or expect to
get, something in return.’ In other words, the giver is buying or trying
to buy you, your actions or decisions and that’s why the emphasis is on
breaches of trust and duty. These are subtle yet important distinctions,
and being aware of the differences of approach will influence how a worker may
respond or take appropriate action. You can read more about the e-learning package here.

Awareness, detection and protection form the cornerstones of
fraud prevention. Moving into 2016 all organisations need to
reflect on their counter fraud initiatives and ensure that they have robust
systems and processes in place. A first step for any organisation is to
assess whether they have the right knowledge, skills, systems and policies in
place to prevent and tackle fraud. Do your staff know, for example, what
is ‘improper’ hospitality? Assessing and evaluating where your
organisation is today in terms of fraud prevention will help to see where the
chinks in your armour may be.

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CIPFA, registered with the Charity Commissioners of England and Wales No. 231060 and the Office of the Scottish Charity Regulator No.SCO37963. CIPFA Business Limited, the trading arm of CIPFA that provides a range of services to public sector clients, registered in England and Wales no.2376684. Registered Office 77 Mansell Street, London E1 8AN